Source: Forex Analysis
GBP/USD has been trading with a bullish bias recently despite the weak economic reports and political uncertainty in the country. The price has been very impulsive for the last three days due to weakness of the USD which was greater than GBP in comparison. Today GBP gained ground in the morning but after the negative economic reports all the bulls were impulsively rejected and currently the market is in a total bearish bias. Today, the UK CPI report was published with a worse value at 2.6% which was expected to be unchanged at 2.9%, PPI Input showed a softer decline at -0.4% from the previous value of -0.7% which was expected to drop to -0.8%, RPI report was published with a worse figure at 3.5% from previous value of 3.7% which was expected to be at 3.6%, Core CPI was published with a worse figure at 2.4% which was expected to be unchanged at 2.6%, HPI report was published at 4.7% which previously was at 5.3% which was expected to be at 3.0%, and PPI Output report was published with a decreased value of 0.0% which was expected to be unchanged at 0.1%. On the USD side, today Import Prices report is due later today which is expected to show a better reading at -0.2% from the previous value of -0.3%, and NAHB Housing Market Index is expected to be unchanged at 67. To sum up, despite the mixed economic reports from the UK today the weakness is again observed on GBP/USD. As the weakness in GBP continues, further bearish pressure is expected to hit the pair in the coming days.
Now let us look at the technical chart. The price has recently rejected the bulls after downbeat economic reports today which led the price to come below 1.3050 resistance level again. Currently, the price is expected to move lower towards 1.2800 support area as of recent rejection of the bulls in the market. If we see a daily close below 1.3050, a further bearish move is expected with a target towards 1.2800. Otherwise, if the price closes above 1.3050 with a daily close today, then further bullish pressure is expected with a target towards 1.3370 resistance level.
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